Xiao-Wei Chen is the sort of scientist you'd want to see stay in the United States. Francis Collins, director of the National Institutes of Health, calls him "one of the smartest kids that's come along in a long time." But after 12 years at the University of Michigan, most recently conducting research into how cellular secretions regulate cholesterol, he's returning to China. Some of the reasons why are ominous for U.S. biomedical research.

Chen's work ranked him at the very top of a group of scientists being evaluated for research work at NIH, but a budget-caused hiring freeze meant no positions were available. At the same time, Peking University offered him a tenure-track position, funding for his research, good lab space and students to help with his work.

Chen's experience is increasingly common, thanks to a declining federal budget for biomedical research. Chen sees his colleagues spending more time in an unsuccessful struggle for grants. "The more I admire them, the less I want to experience what they are going through," he says. "China is now perhaps a better place for me to grow."

The U.S. still leads the world in the basic research that has led to new treatments for cancer and many other diseases. But China, South Korea, India and other nations are aggressively increasing their research funding at the same time that U.S. dollars for NIH, the chief source of federal biomedical research money, have flat-lined.

The result, says Collins, is that inflation has shrunk NIH's purchasing power by about 25% over the last decade, which has sliced the number of grants NIH can make. In better times, NIH funded 30% to 35% of proposals, but now the rate has fallen to about 16%. Collins says the cutoff between the most promising proposals and lesser ones is right around 30% — so about half of the best proposals go unfunded.

This has costs.

Most obviously, medical breakthroughs are delayed or missed. Anthony Fauci, who directs NIH's National Institute of Allergy and Infectious Diseases, cites work in promising areas such as a universal flu vaccine (take it once and you'll never get flu), HIV vaccine, and finding a way to fight antibiotic-resistant superbugs. "We will get there ... much less quickly."

There are economic consequences as well. Collins says that at the current rate, the United States could lose its pre-eminence in biomedical research within five years — bad news for the thriving U.S. biotech industry.

This isn't happening because Congress wants to give away the U.S. lead. Instead, it's the byproduct of bipartisan zeal to cut budget deficits chiefly by slashing the roughly one-third of the budget that goes to everything from defense to medical research, and doing so in a ham-handed way.

While belt-tightening in tough times is appropriate, even at NIH, slashing investment in research that can revolutionize medicine is just foolish. There are better options, particularly in the nearly two-thirds of the budget that goes to entitlement programs, mostly for politically powerful seniors.